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Warm weather chills Sport Chalet Q4 earnings

Published June 4, 2012

LOS ANGELES, CA (BRAIN) Monday June 4 2012 5:39 PM MT— Sport Chalet saw same-store sales drop 5.3 percent in its fiscal fourth quarter, contributing to a loss of $3.8 million, as unseasonably mild weather continued to be a drag on earnings.

For the three months ended April 1, overall net sales declined 16.6 percent to $16.3 million, which Sport Chalet attributed in part to an extra week in the comparable period a year earlier as well as a store closure.

A 32.1 percent decrease in sales of winter-related merchandise was partially offset by a 2.6 percent sales increase in non-winter categories, the company reported. Online sales of winter-related merchandise decreased 27.7 percent, while online sales of non-winter categories increased 56.9 percent.

Net loss for the quarter deepened to $3.8 million from $300,000 a year earlier. For the full fiscal year, the company lost $5.1 million, compared with $3 million for fiscal 2011.

"The nearly unprecedented warm and dry winter weather we experienced in the third quarter continued into the fourth quarter and significantly affected our sales and profitability,” chairman and CEO Craig Levra said in a statement.

"We are encouraged, however, that our efforts to realign our business model in light of the economic slowdown, and our commitment to be first to market with performance, technology and lifestyle merchandise, to expand our specialty brands and to emphasize the expertise of our team has strengthened our underlying core business.”

Levra added that encouraging signs since the end of fiscal 2012 point to a return to the black in the current year.

“Our comparable-store sales increased 2.8 percent for the nine weeks ended June 3, 2012, and with a more normal winter, we believe the consistent improvements we have made to our business over the past few years have positioned us to return to profitability for fiscal 2013."

Some Sports Chalet locations sell bike brands including Fuji, Electra and Masi.

Topics associated with this article: Earnings/Financial Reports

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